What Greece Actually Got From the Eurogroup Negotiations



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Friday’s crucial Eurogroup meeting belongs to history, after what was seen as a historic compromise for both the Eurogroup and a member-state of the single currency as well as a process during which Greece — according to its Finance Minister Yanis Varoufakis — had to encounter the apprehension of its 18 partners. Let’s have a look at what the Greek government actually got from the tight negotiation, as described in the text issued following its conclusion.

As declared, the new deal entails a four-month extension of the loan agreement without new austerity measures and a commitment that no unilateral actions will be taken.

The Greek government’s first gain has a semiological rather than a practical impact, as the EC/ECB/IMF mechanism ceases to exist and the term “Troika,” that gained negative publicity among the Greeks, although these “institutions” are still the ones to oversee the Greek extended loan agreement progress. Similarly, yesterday’s arrangement introduced the term “Master Financial Assistance Facility Agreement” (MFFA) that will replace the term “program.” Most importantly though, Greece, after avoiding the danger of a liquidity shortage that would occur at the end of February due to the current program’s expiry, has until Monday to present its own list of reform measures. These will no longer be agreed with the creditors, but will be designed by the Greek government, presented to the institutions and finally approved by the Eurogroup. This list will be further specified and then agreed with the institutions by the end of April.

All the above might appear as minor gains compared to the Greek voters’ expectations from the new government, although Varoufakis claims he got the most he could from a series of meetings, during which the attitude towards the Greek government was not ideal. In addition, he can also claim he was the one pulling Greece out of its isolation in Europe after five years of suffocating Memoranda agreed to by the previous government.


9 COMMENTS

  1. This article completely ignores that Greece no longer has a primary surplus requirement, which was supposed to rise to 3% GDP this year and 4.5% GDP next year. It would’ve been very painful to implement. It also fails to mention that all the austerity measures that were required to receive the next 7.2B Euro loan are no longer going to happen. These measures included savage cuts to pensions and even more layoffs. Instead, Greece gets to implement their own reforms. And finally, this deal gives Greece the chance to replace the previous austerity measures with savings gained from going after tax evaders and corruption. It’s a very good deal, considering how much pressure Greece was under.

  2. so basically Tsipras is a liar with regards to austerity but he will still give 100’s of thousands of illegal muslim immigrants greek citizenship – well at least he is keeping one of his promises

  3. “Greece gets to implement their own reforms.”

    What you fail to understand is this isn’t a roll back of cuts. This just the EU saying if Syriza want to manage their own cuts that’s an option they are willing to consider. (depending what cuts utterly unprepared Syriza shows up with in a few months when extension ends)

    In other words, Tsipiras LIED when he promised to end austerity.

    Syriza’s empty promises were obvious to everyone except the gullible leftists that supported them. These are essentially the same leftists that fell for the same leftist “eparxoun lefta” rhetoric when they voted for Papandreou. Our leftists never learn. They just vote for whomever tells them they’ll get handouts (i.e. whomever lies to them the most).

    The honest unpopular truth is there will be no major spending sprees any time soon (whether we stay in Euro or not). It will take over a decade for Greece’s to reach its peak. And that will only happen if Greek’s firmly ditch far leftist ideology and focus on supporting our private sector.

    If we want to decline to Cuba and North Korea standards, we should just keep voting in incompetent Marxist extremists. They will feed us a stead diet of speeches proclaiming the glories of communism, how our businesses that create wealth are evil, and how some Illuminati “banksters” and “oligarchs” are to blame for everything…. as we live in perpetual poverty and our freedoms are oppressed by our own over reaching government.

  4. Well said although I believe that Goldman Sachs can be blamed for helping Greece cook the books, gain entrance to the Eurozone and an enormous spending spree in hard currency.

  5. Investments will hardly come in a corrupt country. Employing civil servants for the sake of employment will give growth but only in the short run.

  6. Interesting times ahead for Greece. At least they are no longer in denial. Pensions and low profit on productivity due to excessive beaurocracy and high energy costs are just the tip of the iceberg that has hit the Greek ship. Let’s face it they can never pay back the size of debt they are saddled with and at some point, probably sooner rather than later, the European countries they are in debt to will have to write it off. They can’t be surprised though. If like me you have ever taken a taxi from a Greek airport to anywhere it is usually a fairly new Mercedes or the like. Good for the German economic powerhouse and the banks that supplied the loan for it. But no doubt the taxi owner didn’t have any choice if he wanted to continue to ply his trade from there. However a cheap and reliable Japanese saloon would have done the job fine. The time will come when the only way forward for the average Greek resident to make any daily progress is when they resort back to the Drachma. I will be one of the first in line to go to Greece then. In the meantime, I just love listening to Yanis Varoufakis what a refreshing star he makes!

  7. It’s pretty obvious that your post is one big troll. I’m not falling for your satire. Nice try

  8. More “deep” commentary by genius that supports Marxists. I know its hard for supporters of communists to be critical of their great leaders obvious lies and incompetence but try to stay on topic.

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